Total Probable Reserves increased 104% to 12.7 MMBOE due to Mississippi Lime project

Probable Developed Reserves increased 39% to 2.7 million barrels of oil, 100% oil

PV-10 of Probable Reserves increased 130% to $174 million

The PV-10 of our proved reserves increased 19% to $445.5 million due to increases in commodity prices, slightly offset by a 3% decrease in total volumes to 13.4 MMBOE. The decrease in volumes was due primarily to production and downward revisions in Giddings and our eastern Oklahoma unconventional gas project, as we elected to remove drilling locations and shut-in wells that did not meet our economic parameters, partially offset by an increase in oil volumes at Delhi due to the acceleration of our reversionary working interest date expected in late calendar 2013 and the net addition of proved reserves in the Lopez Field in South Texas. Crude oil reserves, primarily Louisiana Light Sweet oil, are 87% and NGL reserves are 4% of total proved reserves.

Proved developed producing reserves increased 16% over the prior year to 6.1 MMBOE, or 46% of total proved reserves, with a PV-10 of $265.3 million. Crude oil represents 95% of total proved developed producing reserves. Proved developed reserves increased 50% over the prior year to 8.0 MMBOE with PV-10 of $336 million.

Probable reserves increased 104% over the prior year to 12.7 MMBOE with a PV-10 of $174.3 million due to the addition of 6.4 MMBOE associated with 114 gross (25 net) drilling locations in our Mississippian Lime project in Kay County, Oklahoma. Probable Developed reserves, all in Delhi, increased 39% over the prior year to 2.7 million barrels of oil ("BO") with PV-10 of $58.2 million. Our probable reserves are 100% crude oil in Delhi and 57% crude oil and 43% NGL-rich natural gas in the Mississippian Lime.

Evolution Petroleum's Chief Executive Officer, Robert S. Herlin, said: "We continue to execute our strategy of redeploying internal cash flow generated from our foundation asset, the Delhi Field, primarily into our emerging Mississippian Lime Oil Project where we have over 5,300 net acres, providing us ample running room for a multi-year development plan. By refocusing our growth efforts on known oil plays like the Mississippian Lime, we have already doubled our probable reserves. In 2013, we will continue to work to convert our probable reserves into proved reserves, expand other projects and further commercialize our GARP™ technology to build long-term value per-share."

Net oil, NGL and gas volumes for Q4-12 were 52,722 BOE (579 BOE per day), a 6% decrease from the prior quarter's 56,327 BOE (619 BOE per day) and a 32% increase over the year-ago quarter's sales volumes of 39,857 BOE (438 BOE per day). Total volumes in Q4-12 were 76% crude oil and 81% total liquids, somewhat higher than the prior quarter's 77% total liquids, and contributed 97% of total revenues.

The decline in volumes from the prior quarter was due primarily to temporarily reduced CO2 injections at Delhi, as discussed further below, combined with normal depletion in Giddings offset by additions in the Lopez Field. Compared to the year-ago quarter, sales volumes were favorably impacted by increases in production at Delhi, the addition of two wells through our gas assisted rod pump (GARP™) technology and the addition of a producing well in our Lopez Field in South Texas, offset by normal depletion.

Our Q4-12 blended product price increased 1% over the prior quarter and 12% over the year-ago quarter to $86.91 per BOE. Q4-12 oil price declined 3% sequentially and 4% over the year-ago quarter to $108.83 per barrel. NGL prices declined 1% sequentially and 24% over the year-ago quarter to $41.53 per barrel. Our natural gas price for the quarter declined 14% sequentially and 48% over the year-ago quarter to $2.12 per thousand cubic feet. Our blended product price increase was due to our increasing oil content, partially offset by the decreases in prices of the components.

Delhi

Net sales volumes for the year from Delhi increased 208% over the prior year to 136,075 BO (372 BO per day). Net sales volumes for the quarter decreased 3% over the prior quarter to 391 BO per day (5,274 gross BO per day).

The decline for the quarter was due to temporarily reduced CO2 injections resulting from insufficient cooling capacity to handle high summer ambient temperatures combined with a turnaround of the processing plant and drilling activity in the field. Oil production rates are directly driven by CO2 injection rates and the shortfall in cooling capacity is expected to be corrected by next summer. The realized oil price at Delhi averaged $111 per BO for the year and $110 for the quarter, compared to $102 for fiscal 2011.

As of June 30, 2012, our independent engineer assigned proved developed reserves at Delhi of 7.5 million barrels of oil ("MMBO") with PV-10 of $326 million. Proved undeveloped reserves total 3.5 MMBO with PV-10 of $83 million. Probable developed reserves total 2.7 MMBO with PV-10 of $58 million and probable undeveloped reserves total 3.1 MMBO with PV-10 of $45 million.

Production to date predominantly reflects capital expenditures completed through calendar 2010. Going forward, we expect increasing contributions from capital projects completed in 2011 that extended the EOR project through the remainder of the western half of the field. The operator has completed most of the planned capital improvements scheduled for calendar 2012 that began expansion of the project into the eastern half of the field, with further expansions expected to be completed in 2013 and 2014. Later in the decade, we expect to further develop the EOR project by adding four smaller and similar reservoirs, the reserves for which are now categorized as probable since the development occurs more than five years out.

Mississippian Lime (Oklahoma)

We entered into a joint venture in April 2012 to develop the Mississippian Lime in approximately 38 sections (24,320 acres) in central Kay County, Oklahoma. Our leasehold position of 5,345 net acres as of June 30, 2012, which is 45% of the joint venture, is well defined by previous vertical development and bounded by other operators. To date, we have participated in the drilling of one salt water disposal well and two horizontal Mississippian Lime oil wells, the Sneath #1-24H and the Hendrickson #1-1H. We drilled lateral sections of approximately 4,100 feet in the Sneath and 4,800 feet in the Hendrickson. Both wells are scheduled to be hydraulically fractured in the latter part of September. Since industry experience to date has shown that this formation requires some dewatering before oil and gas production begins to increase to its peak rate, we do not expect oil and gas production results until late in our second fiscal quarter 2013.

Our plan is to monitor and evaluate the results of the first two wells in order to optimize our drilling and completion methods for subsequent full-scale development that we expect to initiate early in calendar 2013. We are also considering additional opportunities to expand our position in this play.

Our independent reservoir engineer has evaluated our leasehold based on third party drilling results in the area and assigned 114 drilling locations with net probable reserves of 6.4 million BOE (57% oil and 43% NGL-rich natural gas) with PV-10 of $69 million. Since our joint venture controls approximately half of the acreage within the 38 sections, additional leases may be acquired through the forced pooling process in which all mineral and working interest owners are required to participate, farm-out or lease in the unit.

Artificial Lift Technology (GARP™)

Two commercialization demonstrations of our patented GARP™ technology with industry partners were completed during 2012.

Our first commercial GARP™ installation in December 2011 has yielded stable production that averaged 9 BOE per day during June 2012. We project incremental gross recovery of up to 50 thousand barrels of oil equivalent, and own a 100% working interest subject to a 50% net profits interest in this well.

Our second commercial application was completed in March 2012 and averaged more than 15 BO per day during June 2012. We project incremental gross recovery of more than 50 thousand barrels of oil based on the results to date, and own a 99% working interest before payout and a 76.5% working interest after payout in the well.

These results indicate that the technology has extended the lives of wells that previously had declined to marginal or uneconomic production levels, and has added up to 30% more reserves. In both demonstration agreements, we are paying the installation cost of the technology and are operating the wells in return for an equity ownership. Based on the results to date, we are in discussions with both partners to expand use of GARP™ within the Giddings Field.

We also have initiated discussions with other operators to expand use of the technology.

Lopez Oil Field, South Texas

During 2012, we drilled and completed two oil wells and two salt water injection wells. Work to improve water injection rates in the first drilled injection well during 2012 and an injection well drilled in 2011 led to higher than expected operating expenses and capital expenditures during the third fiscal quarter. Consequently, we were able to commence production from the first oil well drilled in 2012 with high levels of fluid production and water disposal near the end of the prior quarter that resulted in an average production rate of more than 14 BO per day from that well during the fourth fiscal quarter.

Due to the analysis of the electric logs on the second oil well and second injection well drilled in 2012, we elected to convert the oil well to an injection well, and the original injection well to an oil well. We are waiting on the necessary regulatory permits to allow us to commence operating those two wells.

Our independent reservoir engineer has assigned proved reserves of 106 thousand barrels of oil to one producing well and six drilling locations, based on limited production history, with PV-10 of $0.8 million. The engineer also assigned probable reserves of 475 thousand barrels of oil to 32 drilling locations with a PV-10 of $2.5 million.

Giddings Field, Texas

During 2012, our Giddings sales volumes declined 3% sequentially from the prior year to 189 BOE per day, primarily due to full-year contributions from wells drilled in mid-2011 and the addition of the two wells in which GARP™ was installed. During Q3-12, we completed the farmout of our Woodbine rights in 258 net acres in northern Grimes County in exchange for cash, a 5% royalty and an 11.25% reversionary working interest. During Q4-12, we completed a second farmout of our Woodbine rights in 670 net acres in the same area for cash and a 5% royalty interest. We still retain Woodbine rights in about 1,151 net acres in northern Grimes County that may be prospective.

Our independent reservoir engineer assigned proved reserves of 2.3 million BOE with PV-10 of $35.6 million; 21% of the reserves are developed. These reserves include 0.3 million BOE of downward revisions net of additions during the year.

Due to the ongoing low level of natural gas prices, we elected to allow leases underlying certain proved drilling locations to expire without renewal as the economics of drilling those wells did not meet our economic requirements. With remaining proved undeveloped locations in the field averaging less than 50% liquids, we are exploring strategic options for our Giddings assets.

Fiscal 2013 Capital Budget

For the fiscal year ending June 30, 2013, the board of directors has approved a base expenditures budget in the amount of $12.3 million, which includes the remaining balance of the Mississippian Lime project obligation. Expenditures will include:

Mississippian Lime development

$10.4 million

GARP™ installations

1.0 million

Other projects, up to

0.9 million

$12.3 million

Additional expenditures will be considered by the board as opportunities arise to expand one or more of these projects. Existing working capital and projected cash flows from operations are expected to more than cover planned expenditures during the year.

About Evolution Petroleum

Evolution Petroleum Corporation develops incremental petroleum reserves and shareholder value by applying conventional and specialized technology to known oil and gas resources, onshore in the United States. Principal assets as of June 30, 2012 include 13.4 MMBOE of proved reserves and 12.7 MMBOE of probable reserves with PV-10* of $445 million and $174 million, respectively, and no debt. Producing assets include a CO2-EOR project with growing production in Louisiana's Delhi Field, and producing wells and proved drilling locations in the Giddings Field of Central Texas and Lopez Field in South Texas. Other assets include a 45% interest in a joint venture with 114 gross (25 net to EPM) probable drilling locations in the Mississippian Lime play in Oklahoma and a patented artificial lift technology designed to extend the life of horizontal wells with oil or associated water production. Additional information, including the Company's annual report on Form 10-K and its quarterly reports on Form 10-Q, is available on its website at (www.evolutionpetroleum.com).

Cautionary Statement

All statements contained in this press release regarding potential results and future plans and objectives of the Company are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update or review any forward-looking statement, whether as a result of new information, future events, or otherwise. Important factors that could cause actual results to differ materially from our expectations include, but are not limited to, those factors that are disclosed under the heading "Risk Factors" and elsewhere in our documents filed from time to time with the United States Securities and Exchange Commission and other regulatory authorities. Statements regarding our ability to complete transactions, successfully apply technology applications in the re-development of oil and gas fields, realize future production volumes, realize success in our drilling and development activity and forecasts of legal claims, prices, future revenues and income and cash flows and other statements that are not historical facts contain predictions, estimates and other forward-looking statements. Although the Company believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved and these statements will prove to be accurate. Important factors could cause actual results to differ materially from those included in the forward-looking statements.

* PV-10 of proved reserves is a pre-tax non-GAAP measure reconciled to the after-tax Standardized Measure of Future Net Cash Flows below. We believe that the presentation of the non-GAAP financial measure of PV-10 provides useful and relevant information to investors because of its wide use by analysts and investors in evaluating the relative monetary significance of oil and natural gas properties, and as a basis for comparison of the relative size and value of our reserves to other companies' reserves. We also use this pre-tax measure when assessing the potential return on investment related to oil and natural gas properties and in evaluating acquisition opportunities. Because there are many unique factors that can impact an individual company when estimating the amount of future income taxes to be paid, we believe the use of a pre-tax measure is valuable for evaluating our Company. PV-10 is not a measure of financial or operating performance under GAAP, nor is it intended to represent the current market value of our estimated oil and natural gas reserves. PV-10 should not be considered in isolation or as a substitute for the Standardized Measure as defined under GAAP, and reconciled below. Probable reserves are not recognized by GAAP, and therefore the PV-10 of probable reserves cannot be reconciled to a GAAP measure.

The following table provides a reconciliation of PV-10 of each of our proved properties to the Standardized Measure.